Thursday, March 01, 2012

Are we looking at a possible intellectual and economic "ecological" disaster?

Low genetic variation can make a species less resilient to changes in its environment, and place it at increased risk of extinction. BBC News

Ecologists say that when the gene-pool of a species is reduced beyond a certain point that species is in danger of extinction because it may not have enough alternative genes to recover from a negative event such as a plague etc.

Could this concept be applied to our new globalized economy and even to our educational resources?

When I saw the documentary "Food Inc", I was surprised to learn that less than half a dozen corporations control almost all of American agriculture and food production.

I was talking to someone on the far left the other day who said that economic power has become so concentrated in the USA that if you nationalized some 20 corporations, then, in one blow, you would have created a de facto, ad hoc, "real existent socialism". He gave Walmart as an example of a perfect "planned economy". Maybe he is on to something.

Most economists today don’t ask who rules the global economy, visualizing it as a decentralized competitive market that cannot be ruled. Yet new evidence suggests that global economic clout is highly concentrated among large interlocking transnational companies. Three Swiss experts on complex network analysis have recently examined the architecture of international ownership, analyzing a large database of transnational corporations. They concluded that a large portion of control resides with a relatively small core of financial institutions, with about 147 tightly knit companies controlling about 40 percent of the total wealth in the network. Their analysis draws heavily on network topology, a methodology that biologists use to good effect. An article in the British magazine New Scientist describes the research as evidence of a global financial oligarchy. The technical details of economic network analysis are daunting, but the metaphors evoke a “Star Trek” episode: the network is described as a bow-tie shaped “super entity” of concentrated corporate ownership. One cannot help but worry about threats to the safety of the starship Enterprise. In recent years, research on industrial organization has focused more on corporate strategy than on social consequences. A recent article in the socialist journal Monthly Review, by John Bellamy Foster, Robert W. McChesney and R. Jamil Janna, criticizes both mainstream and left-wing economists for their lack of attention to monopoly power. Focusing on the United States, they note that the percentage of manufacturing industries in which the largest four companies account for at least 50 percent of shipping value has increased to almost 40 percent, up from about 25 percent in 1987. Nancy Folbre- New York Times

Increasingly top management has been educated worldwide in practically identical MBA programs so that their responses to any new problems tend to be identical. This too responds to the metaphor of gene-pool depletion.

Universities themselves instead of being citadels of intellectual integrity, are increasingly becoming mere training camps for this corporate concentration:

Most universities before 1945, and even before 1970, were state institutions. The one significant exception was the United States, which had a large number of non-state institutions, most of which had evolved from religiously-based institutions. But even in these U.S. private institutions, the universities were run as non-profit structures. What privatization began to mean throughout the world was several things: One, there began to be institutions of higher education that were established as businesses for profit. Two, public institutions began to seek and obtain money from corporate donors, which began to intrude in the internal governance of the universities. And three, universities began to seek patents for work that researchers at the university had discovered or invented, and thereupon entered as operators in the economy, that is, as businesses. In a situation in which money was scarce, or at least seemed scarce, universities began to transform themselves into more business-like institutions. This could be seen in two major ways. The top administrative positions of universities and their faculties, which had traditionally been occupied by academics, now began to be occupied by persons whose background was in business and not university life. They raised the money, but they also began to set the criteria of allocation of the money. There began to be evaluations of whole universities and of departments within universities in terms of their output for the money invested. This might be measured by how many students wished to pursue particular studies, or how esteemed was the research output of given universities or departments. Intellectual life was being judged by pseudo-market criteria. Even student recruitment was being measured by how much money was brought in via alternative methods of recruitment. Immanuel Wallerstein

Maybe we are fooling ourselves and the rest of the world when we think we live in a democratic, free market economy. In reality we may be immersed in some sort of Mussolini cum Disney corporate statism.

Or maybe the world economic power has conveniently gathered itself together in a sort of virtual "Winter Palace" that could be taken over in one bold revolutionary movement.

Or both.

Whether seen from the point of view of someone who believes in the connection between democracy and the free market or a disciple of Lenin who sees a world of unlimited future opportunities to make a revolution... Whatever it might be, such a power concentration, with its attendant group-think and its economic and intellectual "gene depletion" carries with it very special dangers, dangers which we will all face together, rich and poor alike.DS